U.S., Mexico Agree to Shield U.S. Manufacturers from Double Tax

The U.S. and Mexico have renewed a coordinated effort to prevent U.S. taxpayers from getting hit with taxes twice on manufacturing and assembly functions in Mexico.

The deal, announced on Monday, includes a mechanism to address outstanding accounts that both the U.S. and Mexican competent authorities agree is inconsistent with the transfer pricing profile of the Mexican entity. The two countries also committed to a future agreement that will address economic and public health issues related to the pandemic.

• The program requires taxpayers in Mexico to enter into unilateral advance pricing agreements with the Mexican tax authority, under terms negotiated ...